Indian shares drop most in 7 months

Indian shares sank nearly 3 per cent on Friday as fears that a new, possibly vaccine-resistant coronavirus variant could wreak more economic damage prompted investors to dump equities globally.

The blue-chip NSE Nifty 50 index (.NSEI) ended down 2.91 per cent at 17,026.45 and the benchmark S&P BSE Sensex (.BSESN) closed 2.87 per cent lower at 57,107.15, both marking their biggest daily drops since April 12.

The losses also pushed the Nifty 50 to its worst weekly performance since late January, with both the main indexes losing over 4 per cent this week to move further away from a record high struck in October.

Markets globally were lower after scientists said the new variant detected in South Africa has an unusual combination of mutations, may be able to evade immune responses and could be more transmissible. That led India to tighten COVID-19 testing for tourists.

“Nervousness on the new variant and expectations of the US increasing the pace of tapering have led to recent market weakness,” Amit Gupta, fund manager at PMS at ICICI Securities, said in a note.